A Christian View of Labor Unions

Within certain segments of the Christian community, primarily the Christian Reformed tradition imported from the Netherlands, there is considerable support for the creation of Christian labor unions as an alternative to the secular unions of today. Outside of the Christian Reformed circles, there is almost no discussion of this program within churches. One or two denominations, most notably the Seventh Day Adventists, discourage members from belonging to labor unions. On the whole, the trade union issue is not discussed by churches in any official capacity.

Labor unions are not the major part of the total American labor force, contrary to popular opinion. They are important in the large industries such as autos, steel, and entertainment, but only about 25% of the American labor force belongs to any union, and many of these are weak, rather insignificant organizations. As l hope to demonstrate, it is almost impossible for trade unionism ever to control over half of a nation’s labor force in a democratic country, and where unions control more than this, labor mobility will be reduced markedly.

Do Unions Raise Wages? (Whose? How?)

Unquestionably they do. Do monopolies in business raise prices? Unquestionably they do. Labor unions raise wages in exactly the same way that a business monopoly raises prices: by artificially restricting the supply of a particular resource. Over the long run, with rare exceptions, no monopolist can keep prices raised in this fashion apart from direct government interference into the market. If the government keeps out competitors, then it is possible for monopolists to keep prices above what they would have been in a free market for years or even decades. In the case of diamonds, the DeBeers oligopoly has kept diamond prices up throughout the twentieth century, but it takes the collusion of the South African government to maintain this monopoly (or at least it took such collusion originally).

The economics of monopoly pricing is the foundation of all modern trade unionism. This is either not understood by the supporters of trade unions, or else it is rejected as irrelevant. You will search your days in vain trying to find a supporter of trade unions who is also a supporter of business monopolies, yet the economics of each is identical. The labor union achieves higher wages for its members by excluding non-members from access to the competition for the available jobs. In other words, those who are excluded must seek employment in occupations that they regard as second-best. They bear the primary burden in the marketplace; they are the ones who pay the heaviest price for the higher than market wages enjoyed by those inside the union.

How can unions exclude outsiders from the bidding process? There are many ways, all used effectively by unions over the decades. First, there is raw power. They beat up their competitors. They throw paint bombs (paper bags ?lled with paint) at the homes of their competitors. They threaten the children of their competitors. Their children exclude the children of the competitors from social activities at school, meaning public (government) school. They shout “scab” from their picket lines at strikebreakers. (Strange, isn’t it, that those who defend labor unions never shout “scab” at Ford salesmen who are challenging the so-called monopoly of General Motors?)

Second, and most effective, trade unionists have been able to convince legislators to enact legislation that excludes non-union workers whenever 50% plus one worker vote to choose a particular labor union as the sole bargaining agent in a plant or industry or profession. Professional associations first got such state legislation passed, most notably lawyers, physicians, and dentists. Then, in 1935, the Wagner Act was passed at the national level. It established the National Labor Relations Board (NLRB), a consistently pro-union bureaucratic Federal agency. As far as the favored unions are concerned, 75% of all workers are potential “scabs,” and the NLRB keeps most of them in their second-choice jobs.

There is a third less evident, means of insuring labor union monopoly pricing. This is minimum wage legislation. This legislation is always supported by trade union officials, whose members are always earning wages higher than the proposed minimum wage. This legislation sees to it that regions that have less developed unions, such as the South — in fact, primarily the South W cannot attract industry so easily from the more heavily unionized Northeast. The minimum wage was the primary means of warfare by unions against non-union workers after World War II until very recently. It still may be the primary weapon. The primary loser is, of course, the urban teenage male black, who cannot get into the northern union, or migrate easily to the South, or offer services to employers that are worth the minimum wage.

Employers pay higher wages than the market would have dictated when their labor force is unionized. Of course, employers outside union domination pay lower wages, since they are not compelled by competitive market forces to bid labor away from unionized firms. Since 75% or more of all workers are not in a union, they cannot gain legal access to the labor markets where 25% of the workers are employed. They have to work elsewhere. Thus, nun-unionized employers are granted a subsidy from the government: lower priced workers.

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